Should You Take Comfort From Insider Transactions At Genesys International Corporation Limited (NSE:GENESYS)?

It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Genesys International Corporation Limited (NSE:GENESYS).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

See our latest analysis for Genesys International

Genesys International Insider Transactions Over The Last Year

The Non-Executive Non-Independent Director Ganapathy Vishwanathan made the biggest insider purchase in the last 12 months. That single transaction was for ₹22m worth of shares at a price of ₹21.05 each. We do like to see buying, but this purchase was made at well below the current price of ₹67.75. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Ganapathy Vishwanathan bought a total of 1.83m shares over the year at an average price of ₹34.94. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Genesys International is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Genesys International Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 39% of Genesys International shares, worth about ₹787m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Genesys International Insiders?

It doesn't really mean much that no insider has traded Genesys International shares in the last quarter. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Genesys International insiders think the business has merit. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 3 warning signs (1 is a bit unpleasant!) that you ought to be aware of before buying any shares in Genesys International.

Of course Genesys International may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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